Guest Opinion: Think Like a Business Owner

I was recently asked what I think credit union marketers and business development people should rethink and do differently. While I’m known for being full of answers to that question, the truth of the matter is that many credit union marketers actually do a lot of things very well.

I’m always impressed by their ability to output a lot of marketing with finite resources, be consistent across several media, and genuinely care about helping members. Those things count a great deal.

But where I think credit union marketers and business development people have the biggest opportunity for improvement is much more fundamental to the credit union’s very core than to the cosmetic outputs of the marketing program. In fact, it is so fundamental that responsibility for it cannot be owned solely by the marketing and business development team. However, it can be championed by them.

I’m talking about entrepreneurial thinking. And specifically, to apply this learned way of thinking to reinventing the credit union’s value proposition and rethinking the credit union’s business model.

It’s time for credit union professionals to learn to think like entrepreneurs or intrapreneurs as entrepreneurial thinkers within larger companies are often called. Time to step back from the business they are knee deep in, and see it from a fresh angle. I sincerely believe – no, I know – that upcoming game changing innovations in financial services are not going to come from within the existing ranks of credit unions and banks. They’re going to come from the outside; from entrepreneurs who can look at the opportunity from a completely fresh perspective, and ask, ‘What is the real value proposition we can offer, and what business model will help us do so profitably?’

Reinventing the value proposition. What do we really do here, anyway? What are we really selling? On the surface the answers seem obvious: we help members meet their financial goals, and do so by selling them financial products and services and tools to help them reach those goals. But is that really the answer? Is that really what members are turning to us for? Is that really why members are choosing our credit union over the other credit union down the street?

Are we really in the business we think we’re in? I’m not suggesting there’s a blanket yes or no answer that applies to the industry as a whole. Rather, I'm suggesting every credit union has a responsibility to obsess over that question, and to have its own answer.

Here’s what I’d like to see. Every credit union with a unique and clear answer to the question, ‘what are we really selling here?’ Because as soon as they have their own truly unique answer to this question, they can adjust their brand positioning accordingly, and something magical happens – they suddenly have no competition.

Think about that. No apples-to-apples competition. When you’re in the business of helping members meet their goals, you have 15,000 competitors. But when you’re in the business of [insert unique value proposition here], you have no competition. You've made the competition irrelevant, because they're selling something different than you.

Making the value proposition paradigm shift. I once worked with a credit union that ultimately discovered it was in the business of selling comfort. Not deposit accounts and auto loans. They were really proprietors of comfort. Thus, their products included warm handshakes, hot tea, cozy seating areas, reassuring phone calls, peace of mind granting savings accounts, and auto loans for dependable vehicles. They essentially told their field of membership you can get a checking account or auto loan anywhere, but if you want comfort, we’re the only place for that.

See the difference? This credit union’s revenue model was still the same, and its expenses were mostly unchanged, but its whole focus and purpose was realigned. And members noticed, as evidenced by their growth.

Reinventing the business model. To think like an entrepreneur, it’s also important to step back and examine your business model. What business model do you really have? Sounds like a simple question, but what is your answer? In my experience, credit unions take this question for granted, dismissing it because the answer seems too elementary. Many, however, have a very hard time articulating it clearly.

Once you have a handle on truly understanding the business model you currently have, the next important question is, what other business models might work for us to deliver our value proposition? You could start by analyzing other business models from completely unrelated industries, and asking yourself what you might learn or apply from them. Picking up a case study on a successful manufacturing business, or subscription-based company, for instance, might offer several interesting lessons you could apply in your own business.

Becoming an entrepreneurial thinker. Maybe this all sounds intimidating to you. Well, it should. It’s a huge shift in the industry’s paradigm. If you want to get a head start on changing your mindset so you can start thinking like an entrepreneur, and re-thinking your credit union’s value proposition, I'd recommend you check out these books: “Business Model Generation” by Alex Osterwalder and “The Lean Startup” by Eric Ries. They both represent not only popular titles, but entire movements in the entrepreneurial community.

Hey, marketing and business development: It’s your turn to lead. I truly believe that while marketing and business development cannot alone bear the responsibility for a paradigm shift toward entrepreneurial thinking, they can be the catalyst. Marketers are among the most sincerely passionate of credit union professionals. They can seize the opportunity to be a leader, and not only suggest new ways of thinking, but insist upon them and see them through.

I encourage you to study the principles of entrepreneurship. They will apply to you even as an entrepreneur working so hard to affect change in your credit union.